Defining luxury is not an easy task. Differentiating between what’s a luxury purchase and what’s a necessity is getting harder. So-called ‘luxury items’ are no longer exclusive to the super-rich and it’s harder to understand who the shopper is. So how do we get them through the door and what is it that is going to make them part with their cash?
Louise Williams, Planner at Connect, explores five key marketing investment areas that will enable luxury brands to thrive in an increasingly competitive environment:
1. Know your audience
It goes without saying you must understand your audience before you can talk to them. But with high income no longer the key factor behind what makes a ‘luxury consumer’, is your segmentation strategy up to date?
Yes, you still have your ‘traditional luxury’ shopper, but you now also have the ‘status shopper’ and the ‘social shopper’. Both of whom are typically aged between 25-34 and have an income in excess of £100k. They may not have as much cash as the ‘traditional luxury’ shopper but they’re certainly more willing to part with it. And there are a lot more of them, making them a huge priority when it comes to marketing investment.
This younger, new demographic are also a lot more demanding. They expect consistently high-quality experiences from the minute they land on your website via their latest monogrammed iPhone, to the moment they saunter out of your perfectly mood-lit store, swishing their beautifully designed paper bag. So, embrace the HENRYs (High Earning, Not Rich Yet) and give them what they want, just don’t forget about your traditional customers in the process.
2. Give them secret and exclusive brand experiences
Time is precious. Guaranteeing a luxurious shopping experience gives the shopper a reason to ditch the monotony of the high street and seek out the luxury retailer.
Exclusive collaborations will become even more important. Whilst not a new concept, brands must look for exclusivity and relevancy to draw in similar audiences and create unique experiences.
Members-only retail concepts are springing up all over the place as consumers demand more from their in-store shopping experience. This is the perfect way to make all customers, not just the wealthiest, feel special. Personalised invitations to secret events are not only a sure-fire way to get customers through the door time and time again, but also fuel consumers bragging rights, providing an invaluable organic marketing opportunity.
3. Stores as destinations, not just bricks and mortar
‘Sensploration’ - the multi-sensory journey we now go on when we step into a store. Sound, smell, touch, taste and visual appearance all create a stronger bond between the brand and the consumer.
2016 saw brands such as Hugo Boss and Abercrombie & Fitch use Sensploration with great success as they sprayed their signature scents around their stores to tap into our emotional senses.
It’s all about innovation when competing with the neighbours. Making people understand that, despite the popularity of online shopping, there are some things that online shopping simply cannot replicate. By tapping into all senses, customers are wowed and a single shopping trip can be transformed into a complete sensory experience.
4. Make technology work for you
Technology, and how you incorporate it into your online shopping experience and digital marketing strategy, is a huge competitive differentiator.
The sheer amount of data that can now be gathered about individuals allows retailers to build a comprehensive picture of loyal customers. If used properly, to create a rich and bespoke customer experience, you have a tremendous opportunity to make the consumer feel valued and important and potentially create one of the retailers most powerful marketing tools – the brand advocate.
But technology shouldn’t be limited to behind the scenes. Retailers must also consider how the consumer is using technology to affect their shopping experience. Wearable technology and apps like Apple Pay can enhance the speed and security of the payment process. Having an iPad in store not only aids checkout but also further enhances the in-store experience by giving shoppers access to ‘endless aisles’. After all, luxury customers do not want to be restricted by the limitations of the stores physical stock room.
5. Think beyond the conventional store
Retail outlets are becoming more than just a place to purchase a product.
Last year, brands including Apple and Ikea put CSR at the heart of their design philosophy, opening flagship stores that not only sold products but sought to pull at the heartstrings of the community.
Ikea’s Dining Club promises to encourage more people to cook and eat together. Of course, you can still shop for homeware and now that you’ve created a wonderful personal memory on those particular dinner plates, why wouldn’t you buy them? Genius marketing.
To talk to Louise about how we can help you develop your retail strategy call 01902 714 957 or email firstname.lastname@example.org